TDS is a source of collecting tax by Government of India at the time when a transaction takes place. Here, the tax is required to be deducted at the time money is credited to the payee’s account or at the time of payment, whichever is earlier. Tax is deducted usually over a range of 1% to 10%.
Who has to deduct TDS and when?
Every company and LLP has to deduct TDS when making following payments:
- Salary
- Rent
- Fees for any kind of services availed
- Contract manufacturing
Due Dates for Payment of TDS
| Amount paid/credited | Due date of TDS deposit | |
|---|---|---|
| Government Office | Without Challan | Same Day |
| With Challan | 7th of next month | |
| On perquisites opt to be deposited by employer | 7th of next month | |
| Others | In month of March | 30th April |
| In other months | 7th of next month |
What is TDS Return?
Apart from depositing the tax, the deductor should also file a TDS return.
TDS return is a quarterly statement to be given to the I-T department. It is compulsory for deductors to submit a TDS return on time. The details required to file TDS returns are:
- PAN of the deductor and the deductee
- Amount of tax paid to the government
- TDS challan information
- Others, if any
TDS Return Filing
Due dates of TDS Return FY 2019-20 :
| Quarter | Quarter Period | TDS Return Due Date |
|---|---|---|
| 1st Quarter | 1st April to 30th June | 31st August 2018 |
| 2nd Quarter | 1st July to 30th September | 31st October 2018 |
| 3rd Quarter | 1st October to 31st December | 31st January 2019 |
| 4th Quarter | 1st January to 31st March | 31st May 2019 |
Penalty for delay in filing TDS Return
According to Section234E, if an assessee fails to file his/her TDS Return before the due date, a penalty of Rs 200 per day shall be paid by the assessee until the time the default continues. However, the total penalty should not exceed the TDS amount
Non-filing of TDS Return
If an assessee has not filed the return within 1 year from the due date of filing return or if a person has furnished incorrect information, he/she shall also be liable for penalty. The penalty levied should not be less than Rs 10,000 and not more than Rs 1,00,000.
TDS Return Forms
| Particulars | Form No. |
|---|---|
| TDS on Salary | Form 24Q |
| TDS where deductee is a non-resident, foreign company | Form 27Q |
| TDS on payment for transfer of immovable property | Form 26QB |
| TDS in any other case | Form 26Q |
Various forms are used for filing TDS return, depending on the purpose of deduction. These returns have to be in company with a signed verification in Form No. 27A. It is a form that controls the quarterly statements. This has to be filed by deductors together with quarterly statements. It summarizes the control totals of “amount paid” and “income tax deducted at source” which has to match with the totals in TDS return.